MILAN — A profitable rebalancing of Safilo Group’s model portfolio; sturdy momentum within the U.S., China and on-line, and a rise in prescription body gross sales helped the Italian eyewear firm return to revenue and report a rise in gross sales within the first half.
In the six months ended June 30, Safilo reported a internet revenue of 4.4 million euros, in contrast with an adjusted internet lack of 63.7 million euros in the identical interval final 12 months. This compares with a internet revenue of 8.5 million euros posted within the first half of 2019.
In the primary half of 2021, revenues totaled 510.7 million euros, up 52.2 p.c in contrast with 335.6 million euros in the identical interval final 12 months. Compared to the primary half of 2019, gross sales elevated 3 p.c.
During a convention name with analysts on the finish of buying and selling, chief govt officer Angelo Trocchia touted a second quarter that “continued the solid sales and profitability momentum of the first three months of the year,” which allowed Safilo to shut the primary half with a rebound “well-above the first half of 2019. We believe in the work we are doing and we are moving in the right direction.”
Following the exit of licensed manufacturers Dior, Max Mara and, from the top of June, Fendi, Safilo has been rebalancing its secure of manufacturers with the arrival of latest proprietary and licensed labels, from Blenders and Privé Revaux, to Levi’s, David Beckham, Missoni, Ports, Isabel Marant and Under Armour — successfully compensating for the licenses terminated on the finish of 2020. Chief monetary officer Gerd Graehsler mentioned the brand new licenses and the acquisitions, similar to these of the digitally native model Blenders Eyewear and Privé Revaux, helped offset the exit of licenses of about 200 million euros in gross sales on the finish of 2019.
The natural gross sales efficiency delivered by the group’s comparable manufacturers was very constructive, up high-single digits at fixed change charges in contrast with the second quarter of 2019, led by Smith’s sturdy efficiency in its core product classes, by Carrera and the principle licenses of Hugo Boss, Tommy Hilfiger, Kate Spade and Jimmy Choo.
In May, Safilo inked a license with Dsquared2 and, in July with Carolina Herrera. Trocchia underscored the significance of that settlement “in terms of size and positioning, and it completes our women’s offer. It will help strengthen our business in Iberia and Latin and North America, and helps us to balance the exit of some licenses.” The first assortment will likely be launched in January for spring.
In the second quarter of 2021, the group’s on-line enterprise was up 64 p.c in contrast with the identical interval final 12 months, reaching 14.4 p.c of whole gross sales, because of the contribution of Blenders’ e-commerce gross sales and to the revenues generated by way of the web pure gamers and to Smith’s direct-to-consumer channel.
Safilo’s shareholders on July 30 accepted a share capital enhance as much as a most of 135 million euros, which is anticipated to additional assist the group’s investments, together with new alternatives that will develop into accessible within the sector.
Asked to elaborate, Trocchia mentioned there was no concrete acquisition “option on the table, but we are strongly interested in opportunities and we want to be ready. The industry is very dynamic, in great evolution and we believe we have to be in the right condition.” He ticked off the emergence of Essilux, Thélios and Kering, and mentioned, “We have asked ourselves does it make sense to stay as is?” Responding to a different query on the problem, he mentioned eventual targets can be “in b-to-c or in optical.”
Trocchia and Graehsler emphasised the elevated deal with the optical division, citing the brand new profitable Polaroid and Carrera prescription glasses, for instance. Trocchia mentioned that during the last two years, Safilo has enhanced its gross sales pressure “teaching to sell optical versus sun, which requires a very different set of capabilities,” and additional pushing on “service, which becomes crucial with optical.”
Sports merchandise additionally helped drive enterprise. Smith gross sales nearly doubled within the second quarter in contrast with 2019, mentioned Graehsler, additionally boosted by the direct-to-consumer channel.
In the primary half, gross sales in North America amounted to 240.1 million euros, representing 47 p.c of the full, and had been up 86.9 p.c. Graehsler mentioned the rebound within the U.S. was “better than expected.”
Revenues in Europe rose 26.2 p.c to 208.2 million euros, accounting for 40.8 p.c of the full.
Sales in Asia Pacific represented 5.1 p.c of the full, amounting to 25.9 million euros, up 9.1 p.c. Graehsler touted the efficiency of Safilo in China, however mentioned continued lockdowns within the Asia Pacific area weighed on enterprise there. Tocchia famous that the Ports license, which was very profitable, mirrored Safilo’s sturdy curiosity in China.
Sales in the remainder of the world totaled 36.5 million euros, climbing 98.6 p.c.
Adjusted earnings earlier than curiosity, taxes, depreciation and amortization amounted to 49.7 million euros, in contrast with the adjusted lack of 28.3 million euros recorded within the first half final 12 months. This compares with an adjusted EBITDA of 41.2 million euros within the first half of 2019.
Adjusted working revenue totaled 24.7 million euros, in comparison with an adjusted lack of 55.2 million euros within the first half final 12 months. This compares with an adjusted working revenue of 13.3 million euros recorded within the first half of 2019.
As of June 30, internet debt stood at 226.9 million euros, in contrast with 222.1 million euros on the finish of December 2020.
Based on the better-than-expected first half and the continuation of constructive traits into the start of the third quarter, Graehsler mentioned he expects the group’s full 12 months 2021 gross sales to be above 2019 ranges, up mid-single digits at fixed change charges. Adjusted EBITDA for the 12 months can also be forecast to surpass 2019 ranges. Such expectations are additionally “based on the assumption of a stable business environment” within the second half of 2021, in relation to the COVID-19 pandemic, he underscored. This additionally permits Safilo to substantiate its Group Business Plan 2020-24, introduced on the finish of 2019.